36 HOW TO PAY FOR THE WAR

income groups probably represent increased workto a greater extent than in the case of the higherincome groups, the contribution of the formershould be mainly in the form of deferment ofearnings and the contribution of the latter mainlyin the shape of increased taxation.

(5) The increase in the cost of imports is likelyto involve an increase in the cost of living relativelyto wages of not less than 5 per cent, even withthe existence of subsidies.

There remains the question whether we can hopeto provide the whole of the £950 million required,or rather £1,050 million including the cost offamily allowances, by taxation and the defermentof pay. The proposals, which I put forward in TheTimes and the Economic Journal, were a little faint-hearted in this respect and avowedly fell shortof what was required. It now seems to me betterto start with a scheme which aims at beingadequate, even if this is a counsel of perfection.For subsequent concessions are sure to whittleaway the yield; so that a scheme which is moder-ately less than adequate at the start will beseriously inadequate at the finish. Since variousconcessions recommended in the next chapterare likely to cost at least £50 million, I shallaim, therefore, at a scale of deferment whichshould yield £600 million gross.

Whether the actual scales proposed below willin fact achieve these objects, it is impossible toforecast with accuracy. They aim at carryingout the above principles. If it is shown that theywould fail to do so, they can be amended accord-